Technology can’t rescue the mortgage industry alone

by Kasi Johnston09 Jun 2020

As much emphasis is being placed on technology in tomorrow’s lending environment, it will not be a saving grace without long-term strategies on how that technology fits into your business.

Andrew Weiss, vice president of platform strategy at Origence, an end-to-end digital solution, says while technology plays a critical and strategic role, it’s about understanding your business and how it relates to technology, seeking opportunities to implement, and choosing to collaborate with partners and vendors that have a proven track record.

In a webinar hosted by Origence, Weiss says no one really knows where the mortgage industry is going or what the full effects of the pandemic are going to have on our industry, but it will be a catalyst for change.

“The mortgage industry in general has lagged behind what's happening in the rest of the world relative to using technology. The bar has been set very high for being able to do all sorts of transactions fully online. Consumers have gotten used to the instantaneous experience.”

How can lenders provide high levels of customer engagement while originating mortgages online?

Lenders need to prepare themselves to do a full volume of business in this digital world, says Weiss. With most borrowers starting the application process online, smooth integration of all experiences is important, whether its online, phone or on paper.

“The real driver here is doing things the way the customer wants,” said Weiss. “There is a tendency in our industry to believe that we can come up with a one-size-fits-all solution. The reality is that there are many kinds of borrowers with different capabilities.”

Making the process as easy as possible for the borrower, including easy online pricing is important. With the ability to compare, even before the application process begins, everything needs to be simple. Lenders need to consider how to deal with information authentication, potential for fraud, and how to avoid asking for data you already have.

A big part of satisfying borrowers online is constant communication, he explained. With e-commerce giants like Amazon and Apple, customers are notified when the order is filled, shipped and on its way to being delivered. Weiss says this approach is going to make borrowers feel confident in the process.

“It’s not just about whether the experience was good or bad, but whether it was good enough that the borrower would go out of their way to recommend you,” he said. “Having that constant communications and systems in place to keep that borrower informed can have a real impact.”

As demand for this online process grows, he added that the ability to keep borrowers informed in the way they want is critical, as is the ability to do this efficiently and effectively through automated systems.

Driving time and manual effort out of the process

The average cycle times, depending on the lender is between 30 to 42 days from application to close, not including the shopping experience.

As an industry, Weiss says we have to concentrate on:

  • Getting a qualified yes; achieving this quickly can lock the borrower in.
  • Meeting expectations on price, product and time, with realtors and borrowers.
  • Taking advantage of opportunities to eliminate manual data entry by automating as much of data collection and the evaluation of that data as possible.
  • Auto-ordering services and utilizing integrations for identification of assets

For this to work, Weiss says a trusted relationship with the borrower is still needed, and we cannot rely on technology alone.

“The key is driving out manual effort and embedding these online transactions. Not every borrower is going to be the same, but you want to build a process that allows you to do this in every case [possible], then turn to manual effort for problem cases that can only be addressed by human beings.”

One important note, according to Weiss, is the importance of having a full range of capabilities. Having a slick experience is not enough and the POS needs to be tightly integrated to the overall loan origination system.

“Being able to do a conditional approval, ask for the right document, and only do that once is a very strong indicator of success, in terms of a borrower approval and their willingness to recommend you to others.”

It takes a village

As an industry, Weiss says we need to look at the entire process from shopping, to ease of use and presenting the organization’s brand.

“It takes a village to make a mortgage, so we need to have the entire village on the same page when it comes to reducing the manual effort and permitting interactive, online experiences.”

Integrating technology that will kill the need for processors to “double-check” is needed to move forward.

“We are living in challenging and changing times. We need to embrace these changes. As an industry, we have been sitting by the sidelines as the rest of the world has passed us by, to a large degree, and we need to catch up so we can continue to serve our borrowers in the way that we want to.”